Leading CEX Gate.io asserted that there are no issues with its operations or withdrawals in response to the widespread reports of illiquidity.
“First, we want to emphasize that Gate.io is an established and well-operated exchange. We remain committed to providing users with secure, efficient, and reliable digital asset trading services.”
In the blog post dated May 31, the crypto exchange stated that it is instead focused on its 10th-anniversary celebration and the launch of Gate Group’s Hong Kong trading platform, Gate.HK.
Gate.HK prioritizes compliance and has submitted an application for a Virtual Asset Service Provider [VASP] license to the Hong Kong Securities and Futures Commission, aligning with the latest regulatory requirements.
The other day, crypto Twitter was flooded with numerous posts claiming that the exchange was bankrupt as a result of a purported relationship between it and the Web3 cross-chain router Multichain Multichain [MULTI] whose treasury is backed by 30%.
It all began after crypto tracking firm Arkham Intelligence revealed data indicating significant MULTI inflows to Gate.io, which it said was linked to rumors of the protocol’s team “allegedly being arrested in Shanghai.”
Last week, numerous reports emerged that Chinese authorities allegedly took into custody several Multichain executives, including CEO Zhaojun.
Although the arrests were neither confirmed nor denied by officials, Binance responded by temporarily suspending several bridged tokens that relied on the Multichain protocol.
Then, on May 31, a statement from Multichain’s Twitter account claimed that the protocol had encountered numerous problems as a result of “unforeseeable consequences.”
The team said that despite their best efforts to follow protocol, they were “unable to reach” CEO Zhaojun in order to access crucial servers.
Gate.io Saw a $150M Outflow
Soon after, Twitter users posted transaction trails highlighting significant FTM deposits to the tune of over $10 million from unknown members of the Multichain team to Gate.io.
The identity of the account owner who executed the transaction is now yet unclear.
Due to the massive MULTI and Fantom deposits to Gate.io, numerous Twitter users speculated that the exchange was susceptible to Multichain fallout.
Users hurried to withdraw their assets, causing a $150 million net outflow on the centralized exchange as of right now. The Gate.io crew continued to put up a brave front, labeling the commotion as FUD.